ECONOMY CLASS 10TH (CBSE) H

2.SECTORS OF THE INDIAN ECONOMY

 Economic Activities:

 People are engaged in various economic activities, which can be broadly categorized
into producing goods and providing services.

 Classification of Economic Activities:

 Economic activities can be grouped (classified) based on certain criteria. These

groups are referred to as sectors.

 Three Main Sectors:

 Primary Sector: Involves activities related to the extraction and production of natural
resources, such as agriculture, mining, and fishing.
 Secondary Sector: Involves activities related to the manufacturing and processing of
goods. This includes industries and factories that produce finished products from raw
materials.
 Tertiary Sector: Involves activities related to providing services rather than
producing goods. This includes services like banking, education, healthcare,
transportation, and retail.

 Importance of Sectors:

 Each sector plays a crucial role in the economy, contributing to overall economic
growth and development.
 Understanding these sectors helps in analyzing the structure and functioning of the
economy.

 Primary Sector:

 Involves activities that directly use natural resources.

 Examples include agriculture, dairy, fishing, forestry, mining, and extraction of
minerals and ores.
 Produces natural products such as cotton, milk, and minerals.
 Forms the base for all other products and is also known as the agriculture and related
sector.

 Secondary Sector:
  Involves activities where natural products are transformed into other forms through
manufacturing.
 Examples include industries that produce goods like yarn from cotton, sugar from
sugarcane, and bricks from earth.
 Requires a manufacturing process and is associated with industrial activity.
 Known as the industrial sector.

 Tertiary Sector:

 Involves activities that support the primary and secondary sectors.

 Does not produce goods but provides services that aid the production process.
 Examples include transportation, storage, communication, banking, and trade.
 Generates services rather than goods and is known as the service sector.

 Essential Services in the Tertiary Sector:

 Includes services like education, healthcare, personal services (washermen, barbers,

cobblers, lawyers), administrative and accounting work.
 Recent additions include information technology services such as internet cafes, ATM
booths, call centers, and software companies.

 Primary Sector:

 Involves activities that directly use natural resources.

 Examples include agriculture, dairy, fishing, forestry, mining, and extraction of
minerals and ores.
 Produces natural products such as cotton, milk, and minerals.
 Forms the base for all other products and is also known as the agriculture and related
sector.

 Secondary Sector:

 Involves activities where natural products are transformed into other forms through
manufacturing.
 Examples include industries that produce goods like yarn from cotton, sugar from
sugarcane, and bricks from earth.
 Requires a manufacturing process and is associated with industrial activity.
 Known as the industrial sector.

 Tertiary Sector:

 Involves activities that support the primary and secondary sectors.

 Does not produce goods but provides services that aid the production process.
 Examples include transportation, storage, communication, banking, and trade.
 Generates services rather than goods and is known as the service sector.

 Essential Services in the Tertiary Sector:

 Includes services like education, healthcare, personal services (washermen, barbers,

cobblers, lawyers), administrative and accounting work.
  Recent additions include information technology services such as internet cafes, ATM
booths, call centers, and software companies.

 Interdependence of Sectors:

 The primary, secondary, and tertiary sectors are closely interconnected. Actions in
one sector can significantly affect the others.

 Impact on Sugar Mill:

 If farmers refuse to sell sugarcane to a particular sugar mill, the mill will have to shut
down due to a lack of raw materials.

 Impact on Cotton Cultivation:

 If companies decide to import all cotton instead of buying from the Indian market,
Indian cotton cultivation will become less profitable. Farmers may go bankrupt if they
cannot switch to other crops quickly, leading to a fall in cotton prices.

 Cost of Cultivation:

 Farmers rely on goods such as tractors, pumpsets, electricity, pesticides, and

fertilizers. If the prices of these inputs rise, the cost of cultivation will increase,
reducing farmers' profits.

 Food Supply in Urban Areas:

 People working in industrial and service sectors need food. If transporters go on strike
and lorries refuse to transport vegetables, milk, etc., from rural areas, food will
become scarce in urban areas. Farmers will also be unable to sell their products,
leading to financial losses.

Complete the Table of Sector Dependencies

Here's a conceptual table showing how the primary, secondary, and tertiary sectors depend on
each other:

Sector Dependency Examples

Primary Provides raw materials (e.g., crops, minerals)
Secondary Uses raw materials to manufacture goods
Tertiary Supports primary and secondary sectors (e.g., transport, banking, retail)

2. Explain the Difference Between Primary, Secondary, and Tertiary Sectors

Primary Sector:

 Involves extraction and harvesting of natural resources.

 Examples: Forestry, mining, fishing.
Secondary Sector:

 Involves processing and manufacturing of goods from raw materials.

 Examples: Car manufacturing, paper production, textile production.

Tertiary Sector:

 Involves providing services rather than goods.

 Examples: Healthcare, education, tourism.

3. Classify Occupations into Sectors

Occupation Sector
Tailor Secondary
Basket weaver Secondary
Flower cultivator Primary
Milk vendor Tertiary
Fishermen Primary
Priest Tertiary
Courier Tertiary
Workers in match factory Secondary
Moneylender Tertiary
Gardener Primary
Potter Secondary
Bee-keeper Primary
Astronaut Tertiary
Call centre employee Tertiary

4. Classification of Students into Primary and Secondary/Junior and Senior

Criterion Used:

 The classification is based on age and educational level.

 Primary (Junior): Generally refers to the early years of schooling (elementary level).
 Secondary (Senior): Refers to the later years of schooling (middle and high school
levels).

Is This a Useful Classification?:

 Yes: It helps in organizing educational content and activities appropriate to the

developmental stage of students. It ensures that teaching methods and curricula are
tailored to the age and learning needs of the students.
 Discussion: This classification allows for a structured progression in education, with
clear milestones and goals for each stage. It also helps in providing age-appropriate
support and resources.

 Production Activities:
  Primary, secondary, and tertiary sectors produce a large number of goods and
services.
 Many people work in these sectors to produce these goods and services.

 Measuring Total Production:

 To understand the total production in each sector, economists suggest using the values
of goods and services rather than adding up the actual numbers of different products.
 For example, the value of 10,000 kgs of wheat sold at Rs 20 per kg would be Rs
2,00,000.

 Counting Final Goods and Services:

 It is important to include only the final goods and services in the measurement.
 Final goods are those that reach the consumers and are not used to produce other
goods.
 Intermediate goods, like wheat and flour in the example, are used in the production of
final goods and should not be counted separately.

 Example of Intermediate and Final Goods:

 A farmer sells wheat to a flour mill for Rs 20 per kg.

 The mill grinds the wheat and sells the flour to a biscuit company for Rs 25 per kg.
 The biscuit company uses the flour to make biscuits and sells them to consumers for
Rs 80 (Rs 20 per packet).
 Biscuits are the final goods, and their value includes the value of intermediate goods
like flour.

 Importance of Final Goods:

 The value of final goods already includes the value of all the intermediate goods used
in their production.
 This ensures that there is no double counting of the value of goods.

 Counting Final Goods and Services:

 Counting the value of intermediate goods multiple times (e.g., wheat, flour, and
biscuits) is incorrect as it leads to double counting.
 Only the value of final goods and services should be counted to avoid this issue.

 Gross Domestic Product (GDP):

 GDP is the value of all final goods and services produced within a country during a
particular year.
 It shows how big the economy is.
 In India, GDP measurement is undertaken by a central government ministry with the
help of various government departments of all states and union territories.

 Historical Changes in Sectors:

  At initial stages of development, the primary sector (agriculture, forestry, fishing) was
the most important sector of economic activity in many now developed countries.
 With the introduction of new farming methods, agriculture began to produce more
food, allowing people to take up other activities, such as crafts and trade.
 Over time, the secondary sector (manufacturing and industries) became more
important in terms of total production and employment as factories expanded.
 In the past 100 years, there has been a shift from the secondary sector to the tertiary
sector (services) in developed countries.
 The service sector has become the most important in terms of total production and
employment in developed countries.

 Patterns in India:

 The passage raises the question of whether the patterns observed in developed
countries are also seen in India, specifically regarding the total production and
employment in the three sectors (primary, secondary, and tertiary).

Shifts in Sectors in Developed Countries

The history of developed countries indicates the following shifts between sectors:

 Primary Sector Dominance: At the initial stages of development, the primary sector
(agriculture, forestry, fishing) was the most important sector of economic activity.
Most of the goods produced were natural products, and a majority of the population
was employed in this sector.
 Secondary Sector Growth: As new methods of manufacturing were introduced,
factories started expanding. People who previously worked on farms began to work in
factories, leading to the growth of the secondary sector (manufacturing and
industries). This sector became more important in terms of total production and
employment.
 Tertiary Sector Rise: In the past 100 years, there has been a shift from the secondary
sector to the tertiary sector (services) in developed countries. The service sector
became the most important in terms of total production and employment. This sector
includes activities like transportation, communication, banking, trade, and other
services that support the economy.

This pattern of shifts from primary to secondary and then to tertiary sectors is generally
observed in the development process of many now-developed countries.

2. Correct and Arrange Important Aspects for Calculating GDP

Here's the corrected and arranged statement for calculating GDP:

To count the goods and services, we add the values of the final goods and services produced.
We count all those that were produced in the last year. Since we shouldn’t leave out anything,
we add up the values of all these final goods and services.

3. Calculating the Total Value of a Good or Service Using the Method of

Value Added at Each Stage
Value Added Method: The value-added method calculates the total value of a good or
service by adding the value added at each stage of production. Here's an example to illustrate
this:

1. Stage 1: Farmer Sells Wheat to Miller:

o Farmer sells 1000 kg of wheat to a flour mill at Rs 20 per kg.
o Value added by the farmer: Rs 20,000
2. Stage 2: Miller Sells Flour to Biscuit Company:
o Miller grinds wheat into flour and sells it to a biscuit company at Rs 25 per kg.
o Value added by the miller: Rs 25,000 (Rs 25,000 - Rs 20,000 = Rs 5,000)
3. Stage 3: Biscuit Company Sells Biscuits to Retailer:
o Biscuit company uses flour to make biscuits and sells them to a retailer for Rs
50,000.
o Value added by the biscuit company: Rs 50,000 (Rs 50,000 - Rs 25,000 = Rs
25,000)
4. Stage 4: Retailer Sells Biscuits to Consumers:
o Retailer sells biscuits to consumers for Rs 60,000.
o Value added by the retailer: Rs 60,000 (Rs 60,000 - Rs 50,000 = Rs 10,000)

Total Value Added: The total value added at each stage is:

 Farmer: Rs 20,000
 Miller: Rs 5,000
 Biscuit Company: Rs 25,000
 Retailer: Rs 10,000
 Total Value Added = Rs 60,000

By using the value-added method, we ensure that the value of each stage of production is
accounted for without double-counting intermediate goods. This provides an accurate
measure of the total value of the final good or service.

1. Which was the largest producing sector in 1973-74?

o The primary sector (agriculture and related activities) was the largest
producing sector in 1973-74.
2. Which is the largest producing sector in 2013-14?
o The tertiary sector (services) became the largest producing sector in 2013-14,
replacing the primary sector.
3. Can you say which sector has grown the most over forty years?
o The tertiary sector has grown the most over the forty years from 1973-74 to
2013-14. The production in the tertiary sector has increased significantly
compared to the primary and secondary sectors.
4. What was the GDP of India in 2013-14?
o The passage does not provide the exact GDP value for India in 2013-14.
However, it mentions that the tertiary sector has emerged as the largest
producing sector during that year.

Comparison and Conclusions:

Comparison between 1973-74 and 2013-14:

  Primary Sector: In 1973-74, the primary sector was the dominant sector in terms of
production and employment. Over the years, its importance has diminished, and it is
no longer the largest producing sector.
 Secondary Sector: The secondary sector (manufacturing and industries) grew
significantly during the period, contributing to increased industrial activity and
production.
 Tertiary Sector: The most notable change is the rise of the tertiary sector, which has
become the largest producing sector in 2013-14. This sector includes services such as
healthcare, education, transportation, communication, banking, and trade.

Conclusions:

1. Shift in Sectoral Importance: The comparison shows a significant shift in the

importance of different sectors over the forty years. While the primary sector was
dominant in 1973-74, the tertiary sector took the lead in 2013-14.
2. Growth of the Tertiary Sector: The tertiary sector's growth is a key highlight,
indicating an increased demand for services and the development of a service-based
economy in India.
3. Economic Diversification: The growth of the secondary and tertiary sectors suggests
economic diversification, moving away from reliance on agriculture towards
manufacturing and services.
4. Government's Role: The passage mentions the government's role in providing basic
services such as healthcare, education, and infrastructure, which are crucial for the
development of the tertiary sector.

Reasons for the Rising Importance of the Tertiary Sector:

1. Provision of Basic Services: Services like healthcare, education, transportation,

banking, and communication are essential for the functioning of an economy. The
government plays a crucial role in providing these services, especially in a developing
country.
2. Development of Agriculture and Industry: The growth of the primary and
secondary sectors leads to the demand for services that support these sectors, such as
transportation, storage, and financial services.
3. Increased Demand for Services: As the economy grows and people's incomes rise,
there is an increased demand for various services, contributing to the growth of the
tertiary sector.
4. Technological Advancements: The rise of information technology and related
services has also contributed to the expansion of the tertiary sector.

1. Rising Importance of the Tertiary Sector:

o Over the forty years between 1973-74 and 2013-14, production in all three
sectors (primary, secondary, tertiary) has increased.
o The tertiary sector (services) has grown the most and became the largest
producing sector in India by 2013-14.
2. Reasons for the Importance of the Tertiary Sector:
o Basic Services: The government provides essential services like healthcare,
education, transportation, banking, and communication, which are crucial for
development.
 Development of Other Sectors: The growth of primary (agriculture) and
o
secondary (manufacturing) sectors increases the demand for services like
trade, storage, and transportation.
o Rising Income Levels: With higher incomes, people demand more services
such as tourism, shopping, private healthcare, and education.
o New Services: Information and communication technology services have
become important and their production has been rising rapidly.
3. Unequal Growth within the Tertiary Sector:
o The service sector in India employs a diverse range of people, from highly
skilled workers to those barely managing to earn a living.
o While certain high-skilled services are growing significantly, many workers in
small retail, repair services, and transportation struggle with low earnings and
limited alternative employment opportunities.
4. Employment in Different Sectors:
o Despite the shift in production share, the primary sector remains the largest
employer in India.
o There has not been a corresponding shift in employment from the primary
sector to the secondary and tertiary sectors due to insufficient job creation in
these sectors.

Analysis and Discussion

1. Graph 2: Share of Sectors in GDP (%):

o This graph shows the changing importance of the primary, secondary, and
tertiary sectors in terms of GDP contribution over the forty years.
o It illustrates the decline in the primary sector's share and the significant rise in
the tertiary sector's share.
2. Graph 3: Share of Sectors in Employment (%):
o This graph shows the share of employment in the three sectors in 1977-78 and
2017-18.
o Despite the rise in the tertiary sector's GDP contribution, the primary sector
continues to employ the majority of the workforce.
3. Reasons for Limited Employment Shift:
o Insufficient Job Creation: The secondary and tertiary sectors have not
created enough jobs to absorb the workforce from the primary sector.
o Low Skill Levels: Many workers in the primary sector may lack the skills
required for jobs in the secondary and tertiary sectors.
o Economic Structure: The structure of the Indian economy, with a large rural
population, contributes to the persistence of primary sector employment.

Conclusion

The passage and graphs highlight the significant changes in India's economic structure over
the past forty years, with a notable rise in the importance of the tertiary sector. However, the
persistent dominance of the primary sector in employment underscores the challenges in job
creation and skill development. Addressing these challenges is crucial for achieving balanced
and inclusive economic growth.

 Discrepancy in Sectoral Growth and Employment:

  Industrial output and production of goods increased by more than nine times, while
employment in the industry only increased three times.
 The service sector's production rose by 14 times, but employment in the sector only
rose around five times.

 Primary Sector Dominance in Employment:

 More than half of the workers in India are employed in the primary sector (mainly
agriculture), yet it only contributes about one-sixth of the GDP.
 The secondary and tertiary sectors produce the majority of the GDP but employ less
than half of the workforce.

 Underemployment in Agriculture:

 There are more people in agriculture than necessary, leading to underemployment.

 Even if some workers leave agriculture, production will not be affected.
 Example: Laxmi's family of five works on a small plot of unirrigated land. Despite
everyone working, no one is fully employed. If some family members are hired to
work elsewhere, the family's total income would increase without affecting
agricultural production.

 Disguised Unemployment:

 Underemployment in the agricultural sector is hidden (disguised unemployment)

because everyone appears to be working, but not to their full potential.
 Disguised unemployment is different from visible unemployment, where people do
not have jobs.

 Underemployment in Other Sectors:

 Many casual workers in the service sector, such as painters, plumbers, and repair
persons, do not find work every day and earn very little.
 These workers engage in such jobs because they lack better opportunities.

 Implications:

 Addressing underemployment by creating better employment opportunities in the

secondary and tertiary sectors can improve overall economic productivity and family
incomes.
 Providing alternative work for underemployed agricultural workers will not
negatively impact agricultural production but will enhance their economic well-being.

Changes in the Primary Sector Over Forty Years

Using hypothetical data for Graphs 2 and 3, we can complete the table (note that exact data
might vary):

Year Primary Sector GDP (%) Primary Sector Employment (%)

1973-74 50% 70%
 Year Primary Sector GDP (%) Primary Sector Employment (%)
2013-14 15% 50%

Observations:

 Decline in GDP Contribution: The primary sector's contribution to GDP has

significantly declined from 50% to 15% over forty years.
 Employment: The primary sector still employs a significant portion of the workforce,
although the percentage has decreased from 70% to 50%.
 Underemployment: A large number of workers remain in the primary sector,
resulting in underemployment as their productivity is lower than potential.

2. Correct Answer for Underemployment

Underemployment occurs when people:

(iii) are working less than what they are capable of doing

3. Comparison Between India and Developed Countries

Developed Countries:

 Shift from Primary to Secondary Sector: Initially, the primary sector was
dominant. Over time, the secondary sector (manufacturing) became more important.
 Shift to Tertiary Sector: Eventually, the tertiary sector (services) emerged as the
largest contributor to GDP and employment.

India:

 Primary Sector Dominance in Employment: The primary sector continues to

employ a large portion of the workforce, although its GDP contribution has decreased.
 Secondary and Tertiary Sectors: Both sectors have grown in terms of GDP
contribution, but job creation has not kept pace with GDP growth.

Desired but Not Achieved in India:

 Employment Shift: India has not seen a corresponding shift in employment from the
primary to secondary and tertiary sectors.
 Job Creation: Insufficient job creation in the secondary and tertiary sectors has
resulted in continued high employment in the primary sector.

4. Importance of Addressing Underemployment

Reasons to be Worried About Underemployment:

 Economic Efficiency: Underemployment means that the workforce is not being

utilized to its full potential, leading to lower overall productivity and economic
inefficiency.
  Income and Living Standards: Underemployed workers often earn less than their
potential, affecting their living standards and economic well-being.
 Economic Growth: Addressing underemployment can boost economic growth by
making better use of the available workforce.
 Social Stability: Reducing underemployment can improve social stability by
providing better job opportunities and reducing economic disparities.

 Underemployment in Agriculture:

 There is considerable underemployment in agriculture, where many workers are not

fully utilized to their potential.
 Some people are not employed at all.

 Ways to Increase Employment:

 Investment in Irrigation: Constructing a well for irrigation can enable farmers to

cultivate their land more effectively and grow multiple crops in a year.
o Example: Laxmi with her two-hectare plot of unirrigated land can benefit from
a well for irrigation. This will allow her to grow a second crop, such as wheat,
during the rabi season.
o Employment Potential: One hectare of wheat cultivation can provide
employment to two people for 50 days, including activities like sowing,
watering, and applying fertilizer.

 Government and Bank Support:

 The government can spend money or banks can provide loans to support the
construction of wells and other irrigation infrastructure.
 This investment can lead to increased agricultural productivity and create more
employment opportunities for farmers and agricultural workers.

 Increasing Employment in Agriculture:

 Irrigation: Constructing wells or dams and digging canals can provide irrigation to
farms, allowing farmers to grow multiple crops and employ more family members or
laborers.
 Example: Laxmi's family can grow a second crop, wheat, during the rabi season if
they have access to irrigation.

 Infrastructure Investment:

 Transportation and Storage: Government investment in transportation infrastructure

(rural roads, mini-trucks) and storage facilities can help farmers transport and sell
their produce in nearby towns, creating employment opportunities in transport and
trade.

 Agricultural Inputs and Credit:

  Seeds, Fertilizers, Equipment: Farmers like Laxmi need access to seeds, fertilizers,
agricultural equipment, and pumpsets. Providing affordable agricultural credit through
local banks can help farmers purchase these inputs and improve farming practices.
 Credit Access: Reasonable interest rates from local banks can prevent farmers from
relying on high-interest loans from moneylenders.

 Promoting Industries and Services in Semi-Rural Areas:

 Setting Up Industries: Identifying and promoting industries and services in semi-

rural areas can create employment opportunities. Examples include setting up dal
mills to process pulses, cold storage facilities for potatoes and onions, and honey
collection centers.
 Processing Agricultural Produce: Establishing industries to process vegetables and
agricultural produce (potatoes, sweet potatoes, rice, wheat, tomatoes, fruits) can
provide employment and improve market access.

 Educational Engagement:

 Youth Population: About 60% of India's population is in the age group 5-29 years,
with only 51% attending educational institutions. Ensuring access to education and
skills training is crucial for this demographic.

 Mahatma Gandhi National Rural Employment Guarantee Act 2005 (MGNREGA

2005):

 Provides a guarantee of 100 days of employment per year to rural residents in need of
work.
 If the government fails to provide employment, it will offer unemployment
allowances.
 Emphasizes work that helps increase land productivity.

 Creating Jobs in Education and Healthcare:

 To reduce child labor and increase school attendance, more schools, teachers, and
staff are needed.
 A study by the erstwhile Planning Commission (now NITI Aayog) estimates the
creation of nearly 20 lakh (2 million) jobs in the education sector alone.
 Improving health services requires more doctors, nurses, and health workers,
especially in rural areas.

 Potential for Regional Employment:

 Every state or region has unique potential for increasing income and employment
through various industries like tourism, regional crafts, or new services like IT.
 Proper planning and government support are essential to realize this potential.

 Tourism as a Sector:

 If tourism is improved, it can create additional employment for more than 35 lakh (3.5
million) people annually.
 Short-term and Long-term Measures:

 While some measures may take time to implement, immediate steps are necessary to
provide quick employment opportunities.
 The central government in India implemented the Right to Work law to address short-
term employment needs.

Why is MGNREGA 2005 referred to as 'Right to Work'?

MGNREGA 2005 is referred to as the 'Right to Work' because it guarantees 100 days of
employment per year to any adult who is willing to do unskilled manual work at a minimum
wage rate in rural areas. This law provides a legal right to employment, ensuring that
individuals who are in need of work have access to it. If the government fails to provide
employment, it must offer unemployment allowances, reinforcing the right to work as a
fundamental assurance.

2. Activities Under MGNREGA to Increase Income of People

As the village head, here are some activities that could be taken up under MGNREGA to
boost income and employment:

 Irrigation Projects: Constructing wells, check dams, and canals to improve water
availability for farming.
 Road Construction and Maintenance: Building and maintaining rural roads to
enhance connectivity and access to markets.
 Afforestation and Plantation: Initiating tree planting drives to improve the
environment and provide timber and non-timber products.
 Soil Conservation: Implementing soil conservation measures like contour bunding
and terracing to prevent erosion and improve agricultural productivity.
 Water Harvesting Structures: Building ponds, tanks, and other water harvesting
structures to collect and store rainwater.
 Community Assets: Constructing community centers, storage facilities, and market
sheds to support local trade and social activities.
 Horticulture Projects: Promoting horticulture by providing necessary inputs and
training to farmers.

These activities not only provide immediate employment but also enhance the long-term
productivity and income potential of the village.

3. Impact of Irrigation and Marketing Facilities on Farmers

Income and Employment Increase with Irrigation:

 Multiple Crops: Irrigation allows farmers to grow multiple crops throughout the
year, increasing agricultural output and income.
 Higher Yields: Consistent water supply leads to higher crop yields and better quality
produce, boosting farmers' earnings.
 Employment: More intensive farming requires additional labor, creating more job
opportunities in rural areas.
Income and Employment Increase with Marketing Facilities:

 Market Access: Improved transportation and marketing facilities enable farmers to

sell their produce in larger, more lucrative markets.
 Fair Prices: Access to markets ensures better price realization for farmers, increasing
their income.
 Value Addition: Facilities like cold storage, processing units, and market sheds allow
farmers to store and process their produce, adding value and extending shelf life.

4. Increasing Employment in Urban Areas

Several measures can be taken to increase employment in urban areas:

 Skill Development: Establishing vocational training centers to equip people with

skills required in various industries.
 Encouraging Startups: Providing incentives and support for startups and small
businesses to create new job opportunities.
 Urban Infrastructure Projects: Investing in urban infrastructure development like
housing, public transport, and sanitation, which can generate a significant number of
jobs.
 IT and Service Sector: Promoting IT and service industries by providing necessary
infrastructure and policy support.
 Public Works Programs: Implementing public works programs focused on urban
development projects such as building parks, roads, and public facilities.
 Affordable Housing: Developing affordable housing projects which not only provide
homes but also create construction jobs.

These measures can help address unemployment and underemployment in urban areas,
contributing to overall economic growth.

 Organised Sector:

 Covers enterprises or places of work with regular terms of employment.

 Registered by the government and follow rules and regulations such as the Factories
Act, Minimum Wages Act, Payment of Gratuity Act, Shops and Establishments Act,
etc.
 Workers enjoy security of employment, fixed working hours, and overtime pay if they
work more than the fixed hours.
 Workers receive additional benefits like provident fund, medical and other
allowances, and paid holidays.
 Example: Kanta works in an office with regular hours, a monthly salary, and various
benefits as per government regulations.

 Unorganised Sector:

 Covers workplaces where employment terms are irregular and workers may not have
assured work.
 Workers in this sector often do not have formal employment contracts and may not be
registered with the government.
 They do not enjoy job security, fixed working hours, or additional benefits.
  Example: Kamal is a daily wage laborer in a grocery shop, working long hours
without allowances, paid holidays, or job security.

 Differences Between Organised and Unorganised Sector:

 Employment Security: Organised sector workers have assured work and job
security, while unorganised sector workers do not.
 Working Hours: Organised sector workers have fixed working hours and get paid
overtime for extra hours, whereas unorganised sector workers may work long hours
without overtime pay.
 Benefits: Organised sector workers receive benefits like provident fund, medical
allowances, and paid holidays. Unorganised sector workers typically do not receive
these benefits.
 Formal Contracts: Organised sector workers usually have formal appointment letters
outlining terms and conditions, while unorganised sector workers often lack such
formal agreements.

 Benefits in the Organised Sector:

 Workers in the organised sector receive several benefits, including:

o Paid Leave: Workers get paid leave and payment during holidays.
o Provident Fund: Contributions to the provident fund as per government
regulations.
o Gratuity: Payment of gratuity as a form of retirement benefit.
o Medical Benefits: Access to medical benefits and healthcare facilities.
o Safe Working Environment: Employers are required to ensure facilities like
drinking water and a safe working environment.
o Pensions: Workers receive pensions upon retirement.

 Characteristics of the Unorganised Sector:

 The unorganised sector is characterised by small and scattered units that are largely
outside the control of the government.
 Irregular Employment: Jobs in the unorganised sector are often low-paid and not
regular.
 Lack of Benefits: There is no provision for overtime pay, paid leave, holidays, or sick
leave.
 Insecure Employment: Employment is not secure, and workers can be asked to leave
without any reason.
 Seasonal Employment: Some workers may be asked to leave during seasons with
less work.
 Employer Dependence: Employment conditions depend heavily on the whims of the
employer.

 Types of Workers in the Unorganised Sector:

 Includes a large number of people who are self-employed, doing small jobs like street
vending or repair work.
 Farmers also work on their own and hire laborers as needed.
 Why is MGNREGA 2005 referred to as ‘Right to Work’? The Mahatma Gandhi
National Rural Employment Guarantee Act (MGNREGA) 2005 is often referred to as the
'Right to Work' because it legally guarantees at least 100 days of wage employment in a
financial year to every rural household whose adult members are willing to do unskilled
manual work. This legal guarantee aims to enhance livelihood security in rural areas by
providing guaranteed employment.

 As a village head, what activities would increase the income of people under
MGNREGA? If I were the village head, I would focus on activities that not only provide
employment but also create sustainable assets for the community. Here are some suggestions:

 Water Conservation and Harvesting: Building check dams, ponds, and other water
harvesting structures to ensure a reliable water supply for agriculture.
 Afforestation and Tree Plantation: This would provide future sources of income
through timber and fruits, while also improving the environment.
 Rural Infrastructure Development: Constructing rural roads, improving sanitation
facilities, and building community centers can improve the quality of life and
facilitate better market access.
 Livestock and Poultry Farming: Setting up facilities for dairy and poultry farming
can provide additional sources of income.
 Skill Development Training: Organizing training sessions for new agricultural
techniques, craftwork, or small-scale industries to enhance the skills of the villagers.

 How would income and employment increase if farmers were provided with
irrigation and marketing facilities? Providing irrigation facilities ensures that farmers can
grow crops year-round rather than being dependent on monsoon seasons, leading to increased
agricultural productivity. Marketing facilities help farmers get better prices for their produce
by reducing the reliance on middlemen and allowing them to sell directly in the market.
Together, these facilities can lead to:

 Increased Crop Yields: Regular water supply results in better crop growth and the
possibility of cultivating multiple crops in a year.
 Better Prices: Access to proper marketing facilities ensures farmers get fair prices for
their produce, improving their income.
 Employment Generation: Both irrigation projects and market facilities require
manpower for construction, maintenance, and operation, providing additional
employment opportunities.

 In what ways can employment be increased in urban areas? Urban areas can see an
increase in employment through several initiatives:

 Promoting Startups and Small Businesses: Offering incentives and support for
startups can create numerous job opportunities.
 Skill Development Programs: Providing vocational training and skill development
programs to make the workforce more employable.
 Infrastructure Development: Investing in urban infrastructure projects like
transportation, housing, and public amenities, which can create jobs.
 Encouraging Manufacturing Industries: Setting up manufacturing hubs in urban
areas can attract investments and generate employment.
  Supporting the Gig Economy: Encouraging flexible job options in sectors like
delivery, ride-sharing, and freelance work can provide additional employment
opportunities.

Organised Sector:

1. Formal Employment: Employment in the organised sector is regulated by formal

processes and procedures. This means jobs in this sector are typically registered with
the government and must adhere to specific laws and regulations.
2. Job Security: Workers in the organised sector have assured employment, meaning
they can expect stability and continuity in their jobs.
3. Fixed Working Hours: Employees are required to work a set number of hours. If
they work beyond these hours, they are entitled to overtime pay.
4. Employment Benefits: Workers receive various benefits, such as:
o Health and Safety: Ensured by laws like the Factories Act.
o Minimum Wages: Guaranteed by the Minimum Wages Act.
o Gratuity and Retirement Benefits: Covered under the Payment of Gratuity
Act.
o Workplace Regulations: Governed by the Shops and Establishments Act.
5. Self-Employment within Organised Sector: Even those who are self-employed
must register with the government and follow regulations, ensuring a level of
standardisation and protection.

Example - Kanta:

 Kanta's Job in the Organised Sector: As someone working in the organised sector,
Kanta enjoys job security, regular work hours, overtime pay, and various other
benefits outlined by labour laws.

Organised Sector:

1. Job Security: Workers in the organised sector enjoy stable and assured employment.
2. Regulated Employment: These jobs are registered with the government and adhere
to laws like the Factories Act, Minimum Wages Act, Payment of Gratuity Act, and
Shops and Establishments Act.
3. Benefits:
o Paid Leave: Employees receive paid leave.
o Holiday Payments: Workers are paid even during holidays.
o Provident Fund and Gratuity: Employees contribute to a provident fund and
receive gratuity benefits.
o Medical Benefits: Workers are entitled to medical facilities.
o Safe Working Environment: Employers must provide facilities like drinking
water and ensure a safe workplace.
o Pensions: Upon retirement, workers receive pensions.

Unorganised Sector:

1. Lack of Regulation: Characterised by small, scattered units with minimal

government control and poor enforcement of rules.
 2. Insecure Employment: Jobs are low-paid, irregular, and workers can be dismissed
without notice.
3. No Benefits:
o No Overtime Pay: There is no provision for overtime pay.
o No Paid Leave or Holidays: Workers do not get paid leave, holidays, or sick
leave.
o Employment Insecurity: Employment depends on seasonal work and
employer’s discretion.
4. Self-Employment: Includes many self-employed individuals like street vendors and
repair workers, as well as farmers hiring labor on an as-needed basis.

Unorganised Sector Activities:

1. Unorganised Sector Examples:

o (ii) A headload worker carrying a bag of cement on his back in a market
o (iii) A farmer irrigating her field
o (v) A daily wage labourer working under a contractor
o (vii) A handloom weaver working in her house

Organised vs Unorganised Sector Working Conditions:

2. Comparison of Working Conditions:

o Organised Sector Worker:
 Job Security: Regular and secure employment.
 Fixed Working Hours: Set hours with overtime pay for extra hours.
 Benefits: Paid leave, holidays, provident fund, gratuity, medical
benefits, pensions.
 Work Environment: Safe and regulated by laws.
o Unorganised Sector Worker:
 Job Insecurity: Irregular employment with no job security.
 Flexible Working Hours: Often long hours with no overtime pay.
 Lack of Benefits: No paid leave, holidays, or other employment
benefits.
 Work Environment: Often unsafe and unregulated.

Distinguishing Organised and Unorganised Sectors:

3. Differences:
o Organised Sector:
 Governed by formal regulations and registered with the government.
 Provides job security, fixed working hours, and various benefits.
 Examples include teachers, factory workers, and doctors in hospitals.
o Unorganised Sector:
 Lacks formal regulations and government oversight.
 Jobs are insecure, with no fixed hours or benefits.
 Examples include headload workers, farmers, daily wage labourers,
and handloom weavers.

Employment Statistics:
 4. Unorganised Sector in Agriculture:
o Percentage in Unorganised Sector: A large majority of agricultural workers
are in the unorganised sector, often exceeding 90%.
o Agreement with Agriculture as an Unorganised Activity: Yes, because
most agricultural jobs are not regulated, lack job security, and offer minimal
benefits.

Overall Employment in India:

o Percentage of Unorganised Workers: Around 90% of the workforce in India

is in the unorganised sector.
o Organised Sector Employment: Only about 10% of workers in India are in
the organised sector.

5. Slow Expansion of Organised Sector:

o The organised sector offers the most sought-after jobs but is expanding very
slowly.
o Some organised sector enterprises operate in the unorganised sector to evade
taxes and labor laws.
6. Challenges in the Unorganised Sector:
o Workers in the unorganised sector are often exploited, underpaid, and lack job
security.
o Earnings are low and irregular, and there are no additional benefits like paid
leave or medical facilities.
o Many workers from the organised sector, who lost their jobs since the 1990s,
have been forced into the unorganised sector.
7. Vulnerable Workers Needing Protection:
o Rural Areas: Includes landless agricultural laborers, small and marginal
farmers, sharecroppers, and artisans (e.g., weavers, blacksmiths, carpenters,
goldsmiths).
1. Support needed: Timely delivery of seeds, agricultural inputs, credit,
storage facilities, and marketing outlets.
o Urban Areas: Comprises workers in small-scale industries, casual workers in
construction, trade, transport, street vendors, head load workers, garment
makers, rag pickers.
1. Support needed: Government assistance for raw material procurement
and marketing of output.
2. Casual workers require protection from exploitation and insecure
employment.
8. Social and Economic Development:
o A majority of workers in the unorganised sector belong to scheduled castes,
tribes, and backward communities.
o They not only face irregular and low-paid work but also social discrimination.
o Protection and support for these workers are essential for overall economic
and social development.

Classification of Economic Activities:

1. Importance of Classification:
 o Helps analyze and understand economic activities.
o Different criteria for classification based on objectives.
2. Three Sectors of Economic Activities:
o Primary Sector: Activities related to natural resources (e.g., agriculture,
mining).
o Secondary Sector: Activities related to manufacturing and industry.
o Tertiary Sector: Activities related to services (e.g., education, healthcare).
3. Organised vs Unorganised Sectors:
o Organised Sector:
 Jobs are regulated, secure, and offer benefits (e.g., paid leave,
provident fund).
 Enterprises follow government regulations.
o Unorganised Sector:
 Jobs are irregular, insecure, and lack benefits.
 Many workers are exploited and underpaid.

Important Conclusions from Classification:

 The organised sector provides better job security, working conditions, and benefits
compared to the unorganised sector.
 There is a need to protect and support workers in the unorganised sector.

Problems and Solutions:

 Problems:
o Slow growth of employment in the organised sector.
o Exploitation and lack of security in the unorganised sector.
 Solutions:
o Support for vulnerable groups in rural and urban areas.
o Government interventions to provide facilities, credit, and marketing support.

Public vs Private Sector:

1. Public Sector:
o Government owns assets and provides services.
o Focus is not solely on profit but on public welfare.
o Funded through taxes and other government revenues.
o Examples: Railways, Post Office.
2. Private Sector:
o Owned by private individuals or companies.
o Driven by the motive to earn profits.
o Services are paid for by consumers.
o Examples: Tata Iron and Steel Company Limited (TISCO), Reliance
Industries Limited (RIL).

Government Spending:

 Governments spend on a range of activities to provide services that are essential for
society but not profitable for the private sector.
  These activities often require large investments beyond the capacity of private
enterprises.

Why do you think MGNREGA 2005 is referred to as ‘ Right to work’ ? 2. Imagine that you
are the village head. In that capacity suggest some activities that you think should be taken up
under this Act that would also increase the income of people? Discuss. 3. How would income
and employment increase if farmers were provided with irrigation and marketing facilities? 4.
In what ways can employment be increased in urban areas? HEY give us question answer

Sure, let’s dive into each of your questions:

1. Why is MGNREGA 2005 referred to as ‘Right to Work’? The Mahatma Gandhi

National Rural Employment Guarantee Act (MGNREGA) 2005 is often referred to as
the 'Right to Work' because it legally guarantees at least 100 days of wage
employment in a financial year to every rural household whose adult members are
willing to do unskilled manual work. This legal guarantee aims to enhance livelihood
security in rural areas by providing guaranteed employment.
2. As a village head, what activities would increase the income of people under
MGNREGA? If I were the village head, I would focus on activities that not only
provide employment but also create sustainable assets for the community. Here are
some suggestions:
o Water Conservation and Harvesting: Building check dams, ponds, and
other water harvesting structures to ensure a reliable water supply for
agriculture.
o Afforestation and Tree Plantation: This would provide future sources of
income through timber and fruits, while also improving the environment.
o Rural Infrastructure Development: Constructing rural roads, improving
sanitation facilities, and building community centers can improve the quality
of life and facilitate better market access.
o Livestock and Poultry Farming: Setting up facilities for dairy and poultry
farming can provide additional sources of income.
o Skill Development Training: Organizing training sessions for new
agricultural techniques, craftwork, or small-scale industries to enhance the
skills of the villagers.
3. How would income and employment increase if farmers were provided with
irrigation and marketing facilities? Providing irrigation facilities ensures that
farmers can grow crops year-round rather than being dependent on monsoon seasons,
leading to increased agricultural productivity. Marketing facilities help farmers get
better prices for their produce by reducing the reliance on middlemen and allowing
them to sell directly in the market. Together, these facilities can lead to:
o Increased Crop Yields: Regular water supply results in better crop growth
and the possibility of cultivating multiple crops in a year.
o Better Prices: Access to proper marketing facilities ensures farmers get fair
prices for their produce, improving their income.
o Employment Generation: Both irrigation projects and market facilities
require manpower for construction, maintenance, and operation, providing
additional employment opportunities.
4. In what ways can employment be increased in urban areas? Urban areas can see
an increase in employment through several initiatives:
 o Promoting Startups and Small Businesses: Offering incentives and support
for startups can create numerous job opportunities.
o Skill Development Programs: Providing vocational training and skill
development programs to make the workforce more employable.
o Infrastructure Development: Investing in urban infrastructure projects like
transportation, housing, and public amenities, which can create jobs.
o Encouraging Manufacturing Industries: Setting up manufacturing hubs in
urban areas can attract investments and generate employment.
o Supporting the Gig Economy: Encouraging flexible job options in sectors
like delivery, ride-sharing, and freelance work can provide additional
employment opportunities.

I hope these answers are helpful! If you have any more questions or need further discussion,
feel free to ask.

UUUUUNDERSTNDERSTNDERSTNDERSTNDERSTANDINGANDINGANDINGANDI
NGANDING EEEEECONOMICCONOMICCONOMICCONOMICCONOMIC
DDDDDEVELEVELEVELEVELEVELOPMENTOPMENTOPMENTOPMENTOPMENT3
030303030 Let us examine another way of classifying activities in the economy. This looks
at the way people are employed. What are their conditions of work? Are there any rules and
regulations that are followed as regards their employment? organised because it has some
formal processes and procedures. Some of these people may not be employed by anyone but
may work on their own but they too have to register themselves with the government and
follow the rules and regulations. Workers in the organised sector enjoy security of
employment. They are expected to work only a fixed number of hours. If they work more,
they have to be paid overtime by the employer. They also get several other benefits from the
employers. What are Kanta works in the organised sector. Organised sector covers those
enterprises or places of work where the terms of employment are regular and therefore,
people have assured work. They are registered by the government and have to follow its rules
and regulations which are given in various laws such as the Factories Act, Minimum Wages
Act, Payment of Gratuity Act, Shops and Establishments Act etc. It is called. hey give us
important facts above summary

Got it! Let's break down the key points about the organised sector and its impact on
employment:

Organised Sector:

1. Formal Employment: Employment in the organised sector is regulated by formal

processes and procedures. This means jobs in this sector are typically registered with
the government and must adhere to specific laws and regulations.
2. Job Security: Workers in the organised sector have assured employment, meaning
they can expect stability and continuity in their jobs.
3. Fixed Working Hours: Employees are required to work a set number of hours. If
they work beyond these hours, they are entitled to overtime pay.
4. Employment Benefits: Workers receive various benefits, such as:
o Health and Safety: Ensured by laws like the Factories Act.
o Minimum Wages: Guaranteed by the Minimum Wages Act.
o Gratuity and Retirement Benefits: Covered under the Payment of Gratuity
Act.
 o Workplace Regulations: Governed by the Shops and Establishments Act.
5. Self-Employment within Organised Sector: Even those who are self-employed
must register with the government and follow regulations, ensuring a level of
standardisation and protection.

Example - Kanta:

 Kanta's Job in the Organised Sector: As someone working in the organised sector,
Kanta enjoys job security, regular work hours, overtime pay, and various other
benefits outlined by labour laws.

These points ensure that workers in the organised sector are better protected and have more
stable and secure employment compared to those in the unorganised sector. If you need
further details or have more questions, feel free to ask!

SSSSSECTORSECTORSECTORSECTORSECTORS OFOFOFOFOF
THETHETHETHETHE IIIIINDIANNDIANNDIANNDIANNDIAN
EEEEECONOMYCONOMYCONOMYCONOMYCONOMY 3131313131 these benefits?
They get paid leave, payment during holidays, provident fund, gratuity etc. They are
supposed to get medical benefits and, under the laws, the factory manager has to ensure
facilities like drinking water and a safe working environment. When they retire, these
workers get pensions as well. In contrast, Kamal works in the unorganised sector. The
unorganised sector is characterised by small and scattered units which are largely outside the
control of the government. There are rules and regulations but these are not followed. Jobs
here are low-paid and often not regular. There is no provision for overtime, paid leave,
holidays, leave due to sickness etc. Employment is not secure. People can be asked to leave
without any reason. When there is less work, such as during some seasons, some people may
be asked to leave. A lot also depends on the whims of the employer. This sector includes a
large number of people who are employed on their own doing small jobs such as selling on
the street or doing repair work. Similarly, farmers work on their own and hire labourers as
and when they require.hey give us important facts above summary

Certainly! Here are the key points summarized:

Organised Sector:

1. Job Security: Workers in the organised sector enjoy stable and assured employment.
2. Regulated Employment: These jobs are registered with the government and adhere
to laws like the Factories Act, Minimum Wages Act, Payment of Gratuity Act, and
Shops and Establishments Act.
3. Benefits:
o Paid Leave: Employees receive paid leave.
o Holiday Payments: Workers are paid even during holidays.
o Provident Fund and Gratuity: Employees contribute to a provident fund and
receive gratuity benefits.
o Medical Benefits: Workers are entitled to medical facilities.
o Safe Working Environment: Employers must provide facilities like drinking
water and ensure a safe workplace.
o Pensions: Upon retirement, workers receive pensions.
Unorganised Sector:

1. Lack of Regulation: Characterised by small, scattered units with minimal

government control and poor enforcement of rules.
2. Insecure Employment: Jobs are low-paid, irregular, and workers can be dismissed
without notice.
3. No Benefits:
o No Overtime Pay: There is no provision for overtime pay.
o No Paid Leave or Holidays: Workers do not get paid leave, holidays, or sick
leave.
o Employment Insecurity: Employment depends on seasonal work and
employer’s discretion.
4. Self-Employment: Includes many self-employed individuals like street vendors and
repair workers, as well as farmers hiring labor on an as-needed basis.

These key points highlight the significant differences in employment conditions, benefits, and
job security between the organised and unorganised sectors. If you need more details or
further discussion, feel free to ask!

. Look at the following examples. Which of these are unorganised sector activities? (i) A
teacher taking classes in a school (ii) A headload worker carrying a bag of cement on his
back in a market (iii) A farmer irrigating her field (iv) A doctor in a hospital treating a patient
(v) A daily wage labourer working under a contractor (vi) A factory worker going to work in
a big factory (vii) A handloom weaver working in her house 2. Talk to someone who has a
regular job in the organised sector and another who works in the unorganised sector.
Compare and contrast their working conditions in all aspects. 3. How would you distinguish
between organised and unorganised sectors? Explain in your own words. 4. The table below
shows the estimated number of workers in India in the organised and unorganised sectors.
Read the table carefully. Fill in the missing data and answer the questions that follow. LET’S
WORK THESE OUT · What is the percentage of people in the unorganised sector in
agriculture? · Do you agree that agriculture is an unorganised sector activity? Why? · If we
look at the country as a whole, we find that ———% of the workers in India are in the
unorganised sector. Organised sector employment is available to only about ———% of the
workers in India. hey give us important facts above summary

Unorganised Sector Activities:

1. Unorganised Sector Examples:

o (ii) A headload worker carrying a bag of cement on his back in a market
o (iii) A farmer irrigating her field
o (v) A daily wage labourer working under a contractor
o (vii) A handloom weaver working in her house

Organised vs Unorganised Sector Working Conditions:

2. Comparison of Working Conditions:

o Organised Sector Worker:
 Job Security: Regular and secure employment.
 Fixed Working Hours: Set hours with overtime pay for extra hours.
  Benefits: Paid leave, holidays, provident fund, gratuity, medical
benefits, pensions.
 Work Environment: Safe and regulated by laws.
o Unorganised Sector Worker:
 Job Insecurity: Irregular employment with no job security.
 Flexible Working Hours: Often long hours with no overtime pay.
 Lack of Benefits: No paid leave, holidays, or other employment
benefits.
 Work Environment: Often unsafe and unregulated.

Distinguishing Organised and Unorganised Sectors:

3. Differences:
o Organised Sector:
 Governed by formal regulations and registered with the government.
 Provides job security, fixed working hours, and various benefits.
 Examples include teachers, factory workers, and doctors in hospitals.
o Unorganised Sector:
 Lacks formal regulations and government oversight.
 Jobs are insecure, with no fixed hours or benefits.
 Examples include headload workers, farmers, daily wage labourers,
and handloom weavers.

Employment Statistics:

4. Unorganised Sector in Agriculture:

o Percentage in Unorganised Sector: A large majority of agricultural workers
are in the unorganised sector, often exceeding 90%.
o Agreement with Agriculture as an Unorganised Activity: Yes, because
most agricultural jobs are not regulated, lack job security, and offer minimal
benefits.

Overall Employment in India:

o Percentage of Unorganised Workers: Around 90% of the workforce in India

is in the unorganised sector.
o Organised Sector Employment: Only about 10% of workers in India are in
the organised sector.

If you need any more details or further discussion, feel free to ask!

UUUUUNDERSTNDERSTNDERSTNDERSTNDERSTANDINGANDINGANDINGANDI
NGANDING EEEEECONOMICCONOMICCONOMICCONOMICCONOMIC
DDDDDEVELEVELEVELEVELEVELOPMENTOPMENTOPMENTOPMENTOPMENT3
232323232 How to Protect Workers in the Unorganised Sector? The organised sector offers
jobs that are the most sought-after. But the employment opportunities in the organised sector
have been expanding very slowly. It is also common to find many organised sector
enterprises in the unorganised sector. They adopt such strategies to evade taxes and refuse to
follow laws that protect labourers. As a result, a large number of workers are forced to enter
the unorganised sector jobs, which pay a very low salary. They are often exploited and not
paid a fair wage. Their earnings are low and not regular. These jobs are not secure and have
no other benefits. Since the 1990s, it is also common to see a large number of workers losing
their jobs in the organised sector. These workers are forced to take up jobs in the unorganised
sector with low earnings. Hence, besides the need for more work, there is also a need for
protection and support of the workers in the unorganised sector. Who are these vulnerable
people who need protection? In the rural areas, the unorganised sector mostly comprises of
landless agricultural labourers, small and marginal farmers, sharecroppers and artisans (such
as weavers, blacksmiths, carpenters and goldsmiths). Nearly 80 per cent of rural households
in India are in small and marginal farmer category. These farmers need to be supported
through adequate facility for timely delivery of seeds, agricultural inputs, credit, storage
facilities and marketing outlets. In the urban areas, unorganised sector comprises mainly of
workers in small-scale industry, casual workers in construction, trade and transport etc., and
those who work as street vendors, head load workers, garment makers, rag pickers etc. Small-
scale industry also needs government’s support for procuring raw material and marketing of
output. The casual workers in both rural and urban areas need to be protected. We also find
that majority of workers from scheduled castes, tribes and backward communities find
themselves in the unorganised sector. Besides getting the irregular and low paid work, these
workers also face social discrimination. Protection and support to the unorganised sector
workers is thus necessary for both economic and social development. When factories close
down, many once regular workers are found selling goods or pushing a cart or doing some
other odd job. hey give us important facts above summary

Protection of Workers in the Unorganised Sector

Here are the key points for protecting workers in the unorganised sector:

1. Slow Expansion of Organised Sector:

o The organised sector offers the most sought-after jobs but is expanding very
slowly.
o Some organised sector enterprises operate in the unorganised sector to evade
taxes and labor laws.
2. Challenges in the Unorganised Sector:
o Workers in the unorganised sector are often exploited, underpaid, and lack job
security.
o Earnings are low and irregular, and there are no additional benefits like paid
leave or medical facilities.
o Many workers from the organised sector, who lost their jobs since the 1990s,
have been forced into the unorganised sector.
3. Vulnerable Workers Needing Protection:
o Rural Areas: Includes landless agricultural laborers, small and marginal
farmers, sharecroppers, and artisans (e.g., weavers, blacksmiths, carpenters,
goldsmiths).
 Support needed: Timely delivery of seeds, agricultural inputs, credit,
storage facilities, and marketing outlets.
o Urban Areas: Comprises workers in small-scale industries, casual workers in
construction, trade, transport, street vendors, head load workers, garment
makers, rag pickers.
 Support needed: Government assistance for raw material procurement
and marketing of output.
  Casual workers require protection from exploitation and insecure
employment.
4. Social and Economic Development:
o A majority of workers in the unorganised sector belong to scheduled castes,
tribes, and backward communities.
o They not only face irregular and low-paid work but also social discrimination.
o Protection and support for these workers are essential for overall economic
and social development.

By understanding these points, we can see the importance of supporting and protecting
workers in the unorganised sector to ensure fair wages, job security, and overall well-being.
If you have any more questions or need further information, feel free to ask!

With so many activities taking place around us, one needs to use the process of classification
to think in a useful manner. The criterion for classification could be many depending on what
we desire to find out. The process of classification helps to analyse a situation. In dividing the
economic activities into three sectors — primary, secondary, tertiary — the criterion used
was the ‘nature of activity’. On the basis of this classification, we were able to analyse the
pattern of total production and employment in India. Similarly, we divided the economic
activities into organised and unorganised and used the classification to look at employment in
the two sectors. What was the most important conclusion that was derived from the
classification exercises? What were the problems and solutions that were indicated? Can you
summarise the information in the following table? TABLE 2.4 CLASSIFYING ECONOMIC
ACTIVITIES Another way of classifying economic activities into sectors could be on the
basis of who owns assets and is responsible for the delivery of services. In the public sector,
the government owns most of the assets and provides all the services. In the private sector,
ownership of assets and delivery of services is in the hands of private individuals or
companies. Railways or post office is an example of the public sector whereas companies like
Tata Iron and Steel Company Limited (TISCO) or Reliance Industries Limited (RIL) are
privately owned. Activities in the private sector are guided by the motive to earn profits. To
get such services we have to pay money to these individuals and companies. The purpose of
the public sector is not just to earn profits. Governments raise money through taxes and other
ways to meet expenses on the services rendered by it. Modern day governments spend on a
whole range of activities. What are these activities? Why do governments spend on such
activities? Let’s find out. There are several things needed by the society as a whole but which
the private sector will not provide at a reasonable cost. Why? Some of these need spending
large sums of money, which is beyond the capacity. hey give us important facts above
summary

Sure! Here’s a summary of the key points from the provided text:

Classification of Economic Activities:

1. Importance of Classification:
o Helps analyze and understand economic activities.
o Different criteria for classification based on objectives.
2. Three Sectors of Economic Activities:
o Primary Sector: Activities related to natural resources (e.g., agriculture,
mining).
o Secondary Sector: Activities related to manufacturing and industry.
 oTertiary Sector: Activities related to services (e.g., education, healthcare).
3. Organised vs Unorganised Sectors:
o Organised Sector:
 Jobs are regulated, secure, and offer benefits (e.g., paid leave,
provident fund).
 Enterprises follow government regulations.
o Unorganised Sector:
 Jobs are irregular, insecure, and lack benefits.
 Many workers are exploited and underpaid.

Important Conclusions from Classification:

 The organised sector provides better job security, working conditions, and benefits
compared to the unorganised sector.
 There is a need to protect and support workers in the unorganised sector.

Problems and Solutions:

 Problems:
o Slow growth of employment in the organised sector.
o Exploitation and lack of security in the unorganised sector.
 Solutions:
o Support for vulnerable groups in rural and urban areas.
o Government interventions to provide facilities, credit, and marketing support.

Public vs Private Sector:

1. Public Sector:
o Government owns assets and provides services.
o Focus is not solely on profit but on public welfare.
o Funded through taxes and other government revenues.
o Examples: Railways, Post Office.
2. Private Sector:
o Owned by private individuals or companies.
o Driven by the motive to earn profits.
o Services are paid for by consumers.
o Examples: Tata Iron and Steel Company Limited (TISCO), Reliance
Industries Limited (RIL).

Government Spending:

 Governments spend on a range of activities to provide services that are essential for
society but not profitable for the private sector.
 These activities often require large investments beyond the capacity of private
enterprises.

By summarizing these points, we can better understand the structure and dynamics of
different sectors in the economy and the importance of providing support and protection to
workers, especially in the unorganised sector.
With so many activities taking place around us, one needs to use the process of classification
to think in a useful manner. The criterion for classification could be many depending on what
we desire to find out. The process of classification helps to analyse a situation. In dividing the
economic activities into three sectors — primary, secondary, tertiary — the criterion used
was the ‘nature of activity’. On the basis of this classification, we were able to analyse the
pattern of total production and employment in India. Similarly, we divided the economic
activities into organised and unorganised and used the classification to look at employment in
the two sectors. What was the most important conclusion that was derived from the
classification exercises? What were the problems and solutions that were indicated? Can you
summarise the information in the following table? TABLE 2.4 CLASSIFYING ECONOMIC
ACTIVITIES Another way of classifying economic activities into sectors could be on the
basis of who owns assets and is responsible for the delivery of services. In the public sector,
the government owns most of the assets and provides all the services. In the private sector,
ownership of assets and delivery of services is in the hands of private individuals or
companies. Railways or post office is an example of the public sector whereas companies like
Tata Iron and Steel Company Limited (TISCO) or Reliance Industries Limited (RIL) are
privately owned. Activities in the private sector are guided by the motive to earn profits. To
get such services we have to pay money to these individuals and companies. The purpose of
the public sector is not just to earn profits. Governments raise money through taxes and other
ways to meet expenses on the services rendered by it. Modern day governments spend on a
whole range of activities. What are these activities? Why do governments spend on such
activities? Let’s find out. There are several things needed by the society as a whole but which
the private sector will not provide at a reasonable cost. Why? Some of these need spending
large sums of money, which is beyond the capacity. hey give us above question answer

Most Important Conclusion from Classification Exercises:

The classification of economic activities into primary, secondary, and tertiary sectors, as well
as into organised and unorganised sectors, provided a detailed analysis of production and
employment patterns in India. The most important conclusion derived was that a significant
portion of the Indian workforce is employed in the unorganised sector, which is characterized
by low wages, lack of job security, and inadequate working conditions.

Problems and Solutions Indicated:

1. Problems:
o Slow Growth in Organised Sector Employment: The organised sector has
not expanded fast enough to provide adequate job opportunities.
o Exploitation in Unorganised Sector: Workers in the unorganised sector face
exploitation, low wages, and job insecurity.
o Social Discrimination: Many workers in the unorganised sector belong to
marginalized communities and face social discrimination.
o Inadequate Infrastructure and Support: Both rural and urban unorganised
sectors lack proper infrastructure, facilities, and support.
2. Solutions:
o Government Support: Implementation of supportive policies and schemes to
provide financial aid, infrastructure, and market access to small and marginal
farmers, artisans, and small-scale industries.
 o Regulation and Protection: Strengthening laws and regulations to protect
workers in the unorganised sector, ensuring fair wages, job security, and better
working conditions.
o Skill Development: Offering skill development programs to enhance the
employability and productivity of workers in the unorganised sector.
o Social Inclusion: Promoting social inclusion and reducing discrimination
through affirmative action and community support programs.

Summary of Key Points:

Aspect Organised Sector Unorganised Sector

Job Security High Low
Strictly regulated by
Regulation Poor regulation and oversight
government laws
Paid leave, provident fund, No benefits like paid leave, provident
Benefits
gratuity, pensions fund, or job security
Working
Safe and regulated Often unsafe and unregulated
Conditions
Stable and continuous
Employment Irregular and insecure employment
employment
Teachers, factory workers, Agricultural laborers, street vendors, daily
Examples
doctors in hospitals wage workers, artisans
Government Provides essential services, Needs to support through infrastructure,
Role focuses on public welfare facilities, and market access
Private Sector Driven by profit, services Small businesses and self-employed
Role provided at a cost individuals struggle without support

Public vs Private Sector:

1. Public Sector:
o Government owns assets and provides services.
o Focuses on public welfare, not just profit.
o Examples: Railways, Post Office.
2. Private Sector:
o Assets owned by private individuals or companies.
o Driven by profit motive.
o Examples: Tata Iron and Steel Company Limited (TISCO), Reliance
Industries Limited (RIL).

Government Spending:

 Governments spend on activities that benefit society but are not profitable for the
private sector.
 Examples include infrastructure development, healthcare, education, and public
safety.
 These activities often require large investments that are beyond the capacity of private
enterprises.
 Government's Role vs Private Sector:

 The private sector struggles with large-scale investments and often charges high rates
for services like road construction, bridges, railways, harbors, electricity generation,
and irrigation through dams.
 The government undertakes heavy spending to make these facilities accessible to
everyone.

 Government Support:

 Electricity: To keep production costs low in many industries, especially small-scale

units, the government supplies electricity at affordable rates, bearing part of the cost.
 Agriculture: The government buys wheat and rice from farmers at a fair price, stores
them, and sells them at lower prices through ration shops, supporting both farmers
and consumers.

 Primary Responsibilities of the Government:

 Health and Education: Providing healthcare and education facilities, particularly

elementary education, is a government duty due to India’s large illiterate population.
 Human Development: Addressing malnutrition, providing safe drinking water,
housing for the poor, and ensuring food and nutrition.
 Regional Development: Focusing on the poorest and most neglected regions,
ensuring increased spending to support development.

 Examples of Government Support:

 Electricity Supply: Government intervention to keep industrial costs manageable.

 Fair Price Purchases: Buying essential crops at fair prices and distributing them
affordably.
 Health and Education: Building and maintaining schools and healthcare facilities.
 Child Welfare: Combatting high rates of malnutrition and infant mortality.

Fill in the Blanks:

(i) Employment in the service sector has not increased to the same extent as production. (ii)
Workers in the tertiary sector do not produce goods. (iii) Most of the workers in the
organised sector enjoy job security. (iv) A large proportion of labourers in India are working
in the unorganised sector. (v) Cotton is a natural product and cloth is a manufactured
product. (vi) The activities in primary, secondary and tertiary sectors are interdependent.

Multiple Choice Questions:

(a) The sectors are classified into public and private sector on the basis of:

 (iii) ownership of enterprises

(b) Production of a commodity, mostly through the natural process, is an activity in:

 (i) primary sector

(c) GDP is the total value of:

 (ii) all final goods and services produced during a particular year.

(d) In terms of GDP the share of tertiary sector in 2013-14 is between:

 (iii) 50 to 60 per cent.

3. Matching Problems and Solutions in the Farming Sector:

1. Unirrigated land - (d) Construction of canals by the government

2. Low prices for crops - (c) Procurement of food grains by government
3. Debt burden - (e) Banks to provide credit with low interest
4. No job in the off season - (a) Setting up agro-based mills
5. Compelled to sell their grains to local traders soon after harvest - (b) Cooperative
marketing societies

4. Find the Odd One Out and Why:

(i) Tourist guide (The other jobs are more traditional manual labor or craftsmanship.) (ii)
Vegetable vendor (The other jobs are professional services often requiring formal education
or training.) (iii) Cobbler (The other jobs are government or public service roles.) (iv) Jet
Airways (The other are state-owned enterprises.)

5. Percentage of Workers in the Unorganised Sector in Surat:

Here is the completed table:

Percentage of working
Nature of employment
people
Organised 15%
Own shops, office, clinics in marketplaces 15%
People working on the street, construction workers, domestic
20%
workers
Working in small workshops usually not registered with the
50%
government

Percentage of workers in the unorganised sector in this city: 20% + 50% = 70%

6. Usefulness of Classifying Economic Activities:

Classifying economic activities into primary, secondary, and tertiary sectors helps in
understanding and analyzing the structure of an economy. It allows us to see which sectors
are contributing most to the GDP and employment, and to identify the challenges and
potential growth areas in each sector.

7. Focus on Employment and GDP:

Employment and GDP are crucial indicators of economic health. Focusing on these aspects
helps understand job creation, income levels, and overall economic productivity. Other issues
to examine could include income inequality, environmental sustainability, and social welfare.

8. Classifying Different Types of Work:

List of work: Teaching, farming, shopkeeping, construction, software development, police

service, cooking, healthcare, etc. Classification could be based on sectors (primary,
secondary, tertiary), skill levels (skilled, semi-skilled, unskilled), or formal and informal
employment. The choice depends on the aspect we wish to analyze, such as economic
contribution or social impact.

9. Differences in the Tertiary Sector:

The tertiary sector includes services such as healthcare, education, finance, and retail. Unlike
primary and secondary sectors that focus on goods production, the tertiary sector provides
intangible services. Examples: Hospitals (healthcare), schools (education), banks (finance).

10. Disguised Unemployment:

Disguised unemployment occurs when more people are working than needed for a given task.
Example in rural areas: Many family members working on a small farm where fewer could
suffice. Example in urban areas: Extra workers in a small shop.

11. Open vs Disguised Unemployment:

 Open Unemployment: People who are willing and able to work but cannot find jobs.
 Disguised Unemployment: More workers are employed than necessary, leading to
inefficiency.

12. Role of the Tertiary Sector in Indian Economy:

Disagreeing with the statement, the tertiary sector plays a significant role in India's economic
development by contributing to over half of the GDP. It includes vital services like education,
healthcare, finance, and IT, which drive growth and development.

13. Service Sector in India Employs Two Different Kinds of People:

1. Highly skilled and educated professionals (e.g., doctors, teachers, IT professionals).

2. Low-skilled workers (e.g., street vendors, domestic workers).

14. Workers are Exploited in the Unorganised Sector:

Yes, I agree. Reasons:

 Low Wages: They often receive wages much below the minimum wage.
 Lack of Job Security: Employment is irregular and can be terminated without notice.
 No Benefits: They do not receive benefits like health insurance, paid leave, or
retirement benefits.
  Poor Working Conditions: Often work in unsafe and unhealthy environments.

15. Classification of Economic Activities Based on Employment Conditions:

Economic activities are classified into:

 Organised Sector: Jobs with regular employment, benefits, and legal protection.
 Unorganised Sector: Jobs without formal contracts, irregular employment, and no
legal protection.

16. Employment Conditions in Organised vs Unorganised Sectors:

Aspect Organised Sector Unorganised Sector

Job Security High Low
Paid leave, health insurance,
Benefits No benefits
pensions
Follow labour laws and
Regulation Minimal regulation
regulations
Irregular, often long hours without
Working Hours Fixed, with overtime pay
overtime pay
Work
Safe and healthy Often unsafe and unhealthy
Environment

17. Objective of Implementing MG NREGA 2005:

The Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) aims to
enhance livelihood security in rural areas by guaranteeing at least 100 days of wage
employment to every household whose adult members volunteer to do unskilled manual
work. It aims to create durable assets and improve economic and social infrastructure in rural
areas.

18. Comparing Activities and Functions of Private and Public Sectors:

 Private Sector: E.g., local grocery store, aiming to make profits by selling goods.
 Public Sector: E.g., public school, aiming to provide education services, often funded
by the government to ensure accessibility.

19. Well Managed vs Badly Managed Organisations:

Organisation
Well Managed Organisation Badly Managed Organisation
Type
Public hospital with good Public transportation system with
Public Sector
healthcare services frequent delays
Small private company with poor
Private Sector Efficiently run private bank
employee management

20. Examples of Public Sector Activities:

  Education: Government schools and universities to ensure education for all.
 Healthcare: Public hospitals to provide affordable healthcare.
 Infrastructure: Construction and maintenance of roads and bridges to improve
connectivity.
 Utilities: Provision of electricity and water supply.

21. Public Sector Contribution to Economic Development:

 Infrastructure Development: Building roads, bridges, and public transport systems.

 Social Services: Providing education, healthcare, and housing to improve quality of
life.
 Economic Stability: Regulating essential services like electricity and water to ensure
affordability and accessibility.

22. Protection for Workers in the Unorganised Sector:

 Wages: Implementing minimum wage laws to ensure fair pay.

 Safety: Enforcing safety regulations to prevent workplace accidents.
 Health: Providing access to healthcare and ensuring healthy working conditions.

23. Study in Ahmedabad:

Table:

Sector Number of Workers Total Income (Rs million)

Organised 4,00,000 32,000
Unorganised 11,00,000 28,000
Total 15,00,000 60,000

Ways to Generate More Employment:

 Skill Development: Training programs to enhance employability.

 Infrastructure Development: Creating jobs through construction projects.
 Support for Small Businesses: Providing financial aid and market access.

24. GDP by Three Sectors:

(i) Share of Sectors in GDP:

Year Primary (%) Secondary (%) Tertiary (%)

2000 21.10 19.69 54.21
2013 12.85 17.25 62.40

(ii) Bar Diagram:

(iii) Conclusions from Bar Graph:

 The tertiary sector's share has significantly increased, indicating a shift towards a
service-based economy.
 The primary sector's share has decreased, reflecting reduced reliance on agriculture.
 The secondary sector has shown steady growth, indicating industrial development.